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Ford preparing to wind down Mercury, Bloomberg reports

Automotive News -- May 27, 2010 - 3:09 pm ET

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DETROIT (Bloomberg) -- Ford Motor Co. is preparing to wind down the Mercury line, created in 1939 by Edsel Ford, after sales plunged 74 percent since 2000, said two people familiar with the plan.

The automaker's top executives are preparing a proposal to kill Mercury to be presented to directors in July, said the people, who asked not to be indentified revealing internal discussions. Mercury, losing two of four models next year, will be starved of products and promotion, the people said.

CEO Alan Mulally emphasized the automaker's namesake brand as he revived the only major U.S. automaker to avoid bankruptcy. The timing of Mercury's demise depends on how fast executives can persuade the brand's dealers, who also sell Lincoln models, to close or merge with Ford showrooms, they said.

"Mercury is a forgotten brand," said John Wolkonowicz, an auto analyst with IHS Global Insight. "Many Americans probably already think it has been discontinued. Mercury was too similar to Ford from the very beginning."

Mulally also is unloading Ford's European luxury brands, after the automaker failed to achieve a goal to have them generate one-third of automotive profits. Ford in March agreed to sell Volvo to China's Zhejiang Geely Holding Co. It sold off Jaguar, Land Rover and Aston Martin in the last three years.

Mercury would join Pontiac, Saturn, Oldsmobile and Plymouth among the departed Detroit brands of the 21st century. Sales will end within four years, one of the people estimated. General Motors Co., as part of its U.S.-backed reorganization last year, sold or closed four of its eight brands sold domestically.

Plans "have not changed"

"Our plans regarding Mercury have not changed," said Mark Truby, a Ford spokesman. "Like any good business, we constantly assess our business portfolio. If things change, we will let you know."

Edsel Ford, son of founder Henry Ford, established Mercury during the Great Depression as a mid-priced alternative to mainstream Ford and upscale Lincoln. Edsel's great grand-daughter, Elena Ford, now the automaker's director of global marketing, initially opposed discontinuing Mercury, which she was in charge of promoting prior to 2002, the people said.

Doing away with Mercury is supported by Ford Executive Chairman Bill Ford and other members of the founding family, who have 40 percent voting control of the automaker through a special class of stock, the people said. With Mercury accounting for 1.9 percent of Ford's global sales in the first quarter, the family has decided ending it is best for the business, the people said.

"Edsel Ford is revered in the family, and Mercury was his creation," said Wolkonowicz, a former Ford product planner. "This is the end of an era."

Bill and Elena Ford also declined to comment, Truby said.

1978 peak

Mercury's sales peaked in 1978 at 579,498, when it had the slogan "The Sign of the Cat." Deliveries fell 84 percent to 92,299 last year. As the U.S. auto market recovers, Mercury's sales are up 23 percent this year through April, less than Ford Motor's overall gain of 33 percent. Mercury had 0.9 percent of the U.S. market through April, unchanged from 2009.

Mulally, since arriving from Boeing Co. in September 2006, put a priority on improving quality and expanding the offerings of the Ford brand to lessen its dependence on pickups and SUVs. He ended three years of losses at the automaker by earning $2.7 billion last year and has said 2010 will be "solidly profitable."

As Mulally focused on the namesake brand, Mercury withered, the people said. Ford's ad spending on Mercury fell 88 percent from 2005 through 2009, according to researcher Kantar Media of New York. Last year, Ford stopped selling the Mercury Sable, a sibling to the Taurus. The Mountaineer, Mercury's version of the Explorer, is to go away next year as Ford rolls out a new version of the SUV.

Since Mulally's arrival, Ford stopped giving Mercury exclusive features and technology, the people said. That made Mercury less distinctive than comparable Fords, which tend to be priced lower.

"The reason Mercury failed throughout its existence is because Ford never wanted to spend any money on it," Wolkonowicz said. "Ford always wanted to do it on the cheap and the results were what you'd expect."

Milan #1

Mercury's top-selling model is the Milan, a sibling of the Ford Fusion, with sales up 53 percent this year. Mercury also sells its own version of the Ford Escape SUV, known as the Mariner, which has had a 22 percent sales gain through April. Ford is scheduled to replace those models in 2012 and 2013 and could drop the Mercury versions, Wolkonowicz said.

Mercury's second best-selling model, the Grand Marquis, is being retired next year as Ford stops producing a trio of large, rear-wheel drive sedans that also includes the Lincoln Town Car and Ford Crown Victoria. Mulally has emphasized more fuel- efficient models, such as the Fiesta and Focus small cars Ford is introducing this year in the United States. Neither has a Mercury counterpart.

"The Grand Marquis has the oldest buyer demographics in the industry with an average age of 70," Wolkonowicz said. "There are still members of the Depression generation who will miss Mercury."

Mercury's cultural heyday came in the 1950s, when hot-rodders favored its engines, which were larger and faster than those found in Ford models, Wolkonowicz said. Along with Lincoln, Mercury sponsored "The Ed Sullivan Show" on CBS in the 1950s and 1960s. Detective Steve McGarrett drove a black Grand Marquis in the "Hawaii Five-0" TV series on CBS in the 1970s.

As Mercury's sales plunged, so too have its profits, Wolkonowicz said. With one-quarter of the sales it had a decade ago, it's hard to rationalize the line's continued existence, he said.

"I'm not surprised to see Mercury go because they don't sell enough of them," Wolkonowicz said. "It's been a case of benign neglect for years."

Read more: http://www.autonews.com/apps/pbcs.dll/a ... z0pA0pvBSO
 

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Canada said goodbye to Mercury in 1999.
This name plate exists for the most part as a US domestic product only. It can't be all that cost effective for Ford to run seperate trim lines for vehicles, so it doesn't surprise me that that Ford is looking at focusing production into one core brand.
 

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Will the world end too, like in the movie? :worry:

:cry:
 

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I feel sorry for all those who work in the dealerships that will be adversely affected if this move is true.

There is a dealership here in Knoxville that is a Hummer and Saturn dealership. :doh:
 

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It's a shame that another classic name has to disappear. Unfortunately, Mercury's were nothing more than restyled Fords that cost more. The changes they made didn't really warrant the additional money. I think they should have bought back the Cougar... the real Cougar based on the Mustang platform like they were when they were 1st introduced.
 

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yah know for a brand that Ford wants to wind down. They have been advertising quite a bit. I think they will merge it with Lincoln brand. I really like the luxury of the mercury brand with the prices that are 5-10k less than lincoln brands.
 

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This news really toasts my grits!

They treated Mercury worse than GM treated Oldsmobile. That was the oldest US branded automobile line. Now Mercury is being thrown on the scrape heap of MBA engineered demise. How can anyone succeed if they only cut back? I am begining to suspect that the total of Mr. Mulally's management is the eventual liquidation of all Ford Motor Company. :censor:
 

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Well I have no special favor for Mercury, as the only time it really came to my attention was when I noticed it only had pretty much carbon copies of all the Ford models. So from my experience it was just one more brand that is not really unique or special in any way. I also have a disliking for "Luxury" type vehicles which I'm sure leans me in the opposite direction. I personally feel a vehicle should be made to be tough, reliable, comfortable, and have high performance. Luxury vehicles (and their knock offs) give me the impression of dainty things with too many interior features that stop working after 50k miles.

Personally I think Ford (and all it's branches) has dropped the ball and their new models all suck, including the Escape. Ford is making things cheap, without much true Engineering and real dependability. I was almost set to buy a new vehicle, and I explored all of Ford's models that caught my eye, none of them appealed to me, and the ones I though looked good I quickly lost favor with as soon as my butt hit the driver's seat. The interiors are cheap, the seating was built for dwarf's compared to my tall frame, and they just all around didn't "feel right."

If Mercury gave me the impression of being unique and higher quality than Ford brand, I'm sure I'd hate to see them go, but as it is for me personally, it just looks like a good business move to trim the fat of a branch that isn't performing well, and to me I don't have to wonder why it's not doing well.
 

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I found this snippet below on the Caddy forum and thought it was interesting.

Since 1993 (not all that long ago....) we as Americans have lost these brands: Imperial, Plymouth, Saturn, Pontiac, Oldsmobile, and now Mercury.
Do you realize that "we" only have 8 brands remaining?
From GM: Cadillac, Buick & Chevrolet
From Chrysler: Chrysler, Dodge, Jeep
From Ford: Lincoln & Ford = 8

These 8 have to win buyers away from :
Acura; BMW; Saab; Audi; Honda; KIA; Jaguar; Hyundai; Infiniti; Lexus; Mazda; Mercedes-Benz; Mini; Mitsubishi; Nissan; Porsche; Subaru;
Suzuki; Smart Car; Toyota; Volkswagon, to name a few.
 

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I'm gonna miss the Mariner. It made a flashy debut and I love the little touches that made it more "luxury" than the Escape. Mine is a 2005 Premier and new people who get inside still say what a NICE car it is. To each his own, but I was (and am) soooo happy I got the Mariner over the Escape. We've had a sweet love affair. :heart:
 

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I love our Escape AND Mariner, but I must say that I love my Mariner the best. :D

Dasha, if you are still online, good morning! :) And if you are not still online, then good morning anyway! :lol:
And you should go and buy a new Mariner before they get rid of them. :D
 

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Good morning, Colleen!! :D

Hmmm.....wish I could get a new vehicle right now but my goal is to first pay off my grad school loan. :thumb:
 

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Like was said earlier, Mercery left Canada in 1999, and since they were just carbon copies of Fords, nobody noticed or really cared (Tempo/Topaz, Contour/Mystique, Taurus/Sable, etc). We never got the Mariner, Mountaineer, etc. A couple of dealers in my area did "The Mercury is Rising" promos a couple of summers ago and brought in some used Mercurys from the States. There are some around town, but it really didn't create any buzz, and it hasn't been repeated.

Personally I think the Mercury line is kind of tacky kitch compared to the Ford counterparts, with the only possible exception being the Mariner. It is sort of a faux-luxury brand that seems stuck in the 80s, or at least stuck on the definition of 80s luxury - lots of chrome and stick on cladding and accents. I would still personally rank the Mariner at the bottom of the E/M/T triplets but it isn't vulgar looking like the Mountaineer or the Milan. I actually saw a Milan - New York Plates - yesterday with the fabric roof covering a la 1984. TACKY!
 

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Colleen said:
Dasha said:
Hmmm.....wish I could get a new vehicle right now but my goal is to first pay off my grad school loan. :thumb:
That is more important. :thumb:
Yes, THEN I'll get a new car.....if I'm lucky, another Mariner!! :D
 

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kmoose said:
Personally I think the Mercury line is kind of tacky kitch compared to the Ford counterparts, with the only possible exception being the Mariner. It is sort of a faux-luxury brand that seems stuck in the 80s, or at least stuck on the definition of 80s luxury - lots of chrome and stick on cladding and accents. I would still personally rank the Mariner at the bottom of the E/M/T triplets but it isn't vulgar looking like the Mountaineer or the Milan. I actually saw a Milan - New York Plates - yesterday with the fabric roof covering a la 1984. TACKY!
Personnally, I like the Mariner. I also happen to like the Marquis, especially when they had the Marauder. Much more inline with what I expected from the brand. As for the cladding, it was a copy cat thing that GM was doing and consumer clinics said to add the cladding. :barf: So they did. :doh: I would have bought a Mariner over the Tribute, but the Mercury dealer wanted more money for essentially that same SUV, just like the Ford Dealer nearby was asking. When I can save a grand or three on an SUV, I will and did!

As for the Fabric roof covering... :censor: agreed, just too stupid! The Milan is a neat package, as is the Mariner. I'm just too much of a skin flint to buy one at their price point.

What was also previously posted, the Mercury always had a larger or at least a more powerful engine years ago. Plus they had additional luxury touches. It just didn't translate well in the current market realm when the engine line up was slashed to the minimum.
 
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